U.S. stocks rose sharply yesterday, rebounding from the previous day’s rout, as energy shares bounced back amid a rally for oil prices and worries over Italy’s political crisis faded.

The U.S. added 178,000 private-sector jobs in May, ADP said Wednesday. April’s figure, meanwhile, was revised downward by 41,000 to 163,000, and March’s level was downwardly revised as well. Hiring was spread across industries and company size. Medium-sized businesses — those with 50 to 499 employees — added 84,000 jobs, while large businesses added 56,000 positions and small ones added 38,000 employees.

The U.S. grew economy grew a touch softer in the first quarter than originally reported, mainly because of a slower buildup in inventories. Gross domestic product was trimmed to an annual 2.2% pace from 2.3%.

The Federal Reserve’s Beige Book came out and the Fed said the U.S. grew “moderately” from late April to early May in their latest evaluation of the economy, indicating the central bank remains firmly on track to raise interest rates next month. Although companies have responded to chronic shortages of skilled workers by boosting pay and overall compensation, the Fed found that “wage increases remained modest” in most of the country.

Political turmoil is pushing Italian yields higher, but not signaling broader crisis. Italian yields have spiked in recent days, with the 2-year yield moving from 0.46% on Friday May 25, to 2.2% currently; this after it was actually negative (-0.08%) two weeks ago. It is important to note however, that yields in Germany and France actually moved lower on this news. The fact that markets are using core European countries as a safe haven may indicate that they believe the issue is in Italy itself, and investors aren't concerned about the potential for broader contagion in the Eurozone at this point. (LPL)

The Bloomberg Barclays Municipal Bond Index has outperformed the broader Bloomberg Barclays Aggregate Index year to date (-0.9% vs -2.2%) and since the beginning of 2017 (4.5% vs 1.2%). (LPL)

Microsoft is up 40% over the last 12 months and is now worth $749 billion and is the world's third most valuable company behind Apple and Amazon. (CNBC)

Dick's Sporting Goods beat forecasts by 7 cents a share, with adjusted quarterly profit of 52 cents per share. Revenue also came in above forecasts. Comparable-store sales fell more than expected, but Dick's also raised its full-year outlook largely above Street's forecast. (AP)

Oil below $70/barrel on supply concerns. U.S. benchmark crude prices was down nearly 3% last Friday as traders digested reports that OPEC, Russia, and others are in discussions to potentially increase production by up to 1 million barrels/day. The news comes on the heels of an announcement from the International Energy Agency last week that the supply glut is gone and the run-up in oil prices is starting to impact consumer demand. (LPL)

According to Reuters, Qualcomm will meet with Chinese regulators in Beijing this week, as it seeks to get final clearance for its $44 billion deal to acquire NXP Semiconductors. (CNBC)

Coca-Cola is selling its first alcoholic product called Lemon-Do to consumers of Japan. The lemon-flavored drink will be available with 3%, 5% and 7% alcohol. (Fortune)

More trade ups and downs. President Trump ordered an investigation into whether auto and truck imports weaken the U.S. economy and threaten national security, which sparked a response from a Chinese official suggesting the move represented an abuse of trade rules. Though likely another part of the administration's negotiation strategy, it may lead to new tariffs on foreign cars. (LPL)

The U.S. economy is still chugging along. The Markit Purchasing Managers' Index showed both the U.S. services and manufacturing sectors continued to expand last month. Manufacturing activity registered its highest reading since September 2014, with manufacturers intending to boost production in the near term. Backlogs of work on the services side hit levels not seen since March 2015, though new business ticked modestly lower. Input costs in both sectors rose at the fastest pace in almost five years as inflationary pressures continue to mount, but overall the data remain solidly in expansionary territory year. (LPL)

Ross Stores beat estimates by 3 cents with quarterly profit of $1.10 per share, with the discount retailer's revenue in line with forecasts. (CNBC)

Join us this weekend for Financial Focus Radio.

S&P 500 is down 6 and the NASDAQ is down 1. The MSCI international index is lower.

Is Turkey a canary in the coal mine? Turkey's currency, the lira, has lost over 20% versus the dollar since the start of the year and dropped as much as 5% overnight on Tuesday, as market participants' worries about the state of Turkey's economy rose. (LPL)

Uber announced its first-quarter financials, reporting strong sales growth. Uber plans to sell between $400 million and $600 million in stock at $40 per share to investors. (CNBC)

Best Buy's same store sales rose 7.1% in the first quarter.

Domestic online comparable sales growth was 12% in the U.S.. Best Buy has about 15% of the U.S. consumer electronics market. (Reuters)

Hormel Foods, makers of Spam canned ham, Dinty Moore stew and other foods, reported quarterly earnings of $237.4 million. Revenue was $2.33 billion in the period. Hormel shares have dropped almost 2% since the beginning of the year. (AP)

Procter & Gamble says it will continue investing in Russian plants in the coming years, despite increasing risks due to deteriorating U.S.-Russian relations. (AP)

S&P 500 is down 6 and the NASDAQ is down 7. The MSCI international index is lower.

The 10-year Treasury yield again broached the 3% level last week, and unlike previous instances, it managed to stay above that level for the entire week, indicating Treasuries may have moved into a new range. (LPL)

The Russell 2000 closed at yet another new all-time high this week. For the year, there have been 14 new highs for the Russell 2000 and 14 for the S&P 500 Index. The Russell 2000 is up 6.6% for the year, versus a 2.2% gain for the S&P 500. Sparking the strength in small caps has been a better economy, tax reform, fear over trade tariffs, and a stronger U.S. dollar. (LPL)

Marvin Ellison, J.C. Penney chairman and CEO is leaving the retailer to become CEO at Lowe's. Prior to J.C. Penney, Ellison worked more than 12 years at Home Depot. (CNBC)

Is the next U.S. recession just around the corner? In a survey of 100 economists and real estate experts sponsored by Zillow nearly half expect the next recession to begin sometime in 2020. (AP)

Red Robin Gourmet Burgers earned 69 cents per share last quarter. Revenue was also short of estimates. Same store sales dropped 0.9%. (CNBC)

Over the last week, forward-four-quarter estimates for the S&P 500 Index rose 0.6%. With 464 S&P companies having reported, first quarter S&P 500 earnings are tracking to a 26.2% year-over-year increase, while 79% of companies have exceeded earnings targets. (LPL)

The U.S. dollar has come back strongly over the past several months. After losing nearly 10% in 2017 and an additional 4% in January, the U.S. Dollar Index has rallied more than 5% off its February lows. Gains have been driven by several factors, particularly rising U.S. interest rates, partially due to increasing Federal Reserve (Fed) rate hike expectations, and repatriation of overseas profits as prescribed by the new U.S. tax law. (LPL)

Hasbro, the maker of the iconic Play-Doh has successfully trademarked that musky, sweet vanilla scent of childhood.
Few tweaks have been made to Play-Doh's recipe since its inception in 1956, and its scent has always been one of its main differentiation from other clay competitors.(CNBC)

A slow walk to the gallows? J.C. Penney reported first quarter results. Revenue fell about 4.3% to $2.58 billion. Same-store sales rose 0.2% but were short of analysts' forecast of 2% growth. Penney's lost $78 million, or 25 cents per share. (Reuters)

The Conference Board's Leading Economic Index gained 0.4% to 109.4 in April and has climbed for the last six months. The index measures 10 key metrics of economic movement and projects US economic conditions for the next 6 to 12 months.

General Electric has made a deal to merge its transportation business with rail industry equipment maker Wabtec (Reuters).

Microsoft has bought Semantic Machines, an artificial intelligence start-up. The company did not disclose any financial details of the acquisition. (CNBC)

New applications for unemployment benefits were reported at 222,000 this week. Claims remain near 40-year lows. (LPL)

Japan's streak of positive GDP growth quarters comes to an end. After eight straight quarters of growth, the longest streak in nearly 30 years, Japan's gross domestic product contracted in the first quarter. (LPL)

According to the Centers for Disease Control US births hit lowest number since 1987: American women are having children at the lowest rate on record, with the number of babies born in the U.S. last year dropping to a 30-year low. 3.85 million babies were born last year, down 2% from 2016.

Argentina's currency stabilized as their central bank declined to support the peso, which has plunged about 16% this month. Argentina is seeking a loan from the IMF and is the Greece of Latin America. (Reuters)

Nordstrom had quarterly profits of 51 cents per share beating estimates by 8 cents. They also beat on sales. But same store sales growth was disappointing. The stock was sinking in early trading. (CNBC)

The Federal Reserve said U.S. factory output rose in April by 0.7%. Manufacturing output rose 0.5%. A 2.3% increase in machinery production bolstered the overall gain in factory output. In the last year industrial output is up 3.5%. Industrial capacity in use rose 78%.

Economic growth forecasts tracking above 3%. With half of the second quarter now in the rearview, consensus forecasts are tracking to 3.1% gross domestic product growth for this quarter, while forecasts from the Atlanta and New York Federal Reserve Bank's show 4.1% and 3.1%, respectively. With economic surprises, on average, being to the upside, second quarter growth exceeding 3.0% would represent a very solid quarter and push full-year growth nearer to the 2.75-3.0% range. (LPL)

Jack In The Box had profits of 80 cents per share falling 6 cents short of estimates. The burger joints sales also missed. (Yahoo)

Microsoft has a new Xbox controller with customizable features for disabled gamers. It's set to launch later this year. (CNBC)

The yield on the 10-year Treasury note hit its highest level since 2011 and the two-year yield hit its highest mark since 2008 on Tuesday. The 10-year hit 3.07% and the two-year yield hit a high of 2.59%. (AP)

The Commerce Department says retail sales rose 0.3% last month after jumping 0.8% in March. Retail sales have increased 4.7% from a year ago. Consumer spending, accounts for more than two-thirds of U.S. economic activity. In April, auto sales edged up 0.1%, receipts at service stations jumped 0.8% and sales at restaurants and bars fell 0.3%. (Reuters)

The average mortgage contract rate on the 30-year fixed ended Tuesday at 4.88% for the highest creditworthy borrowers and 5% for the average borrower, the highest level in seven years. (CNBC)

Macy's reported first quarter profits of 48 cents per share on revenue of $5.5 billion. Same-store sales increased 4.2%. Shares are up about 13% in early trading. (AP)

Yum Brands owned Pizza Hut will become the largest pizza chain in Latin America and the Caribbean, after signing a franchise agreement with Spain's Telepizza Group. (CNBC)

An outstanding first quarter earnings season is winding down. With 455 S&P 500 Index companies having reported first quarter 2018 results, earnings are tracking to a 26% year-over-year increase. The new tax law is giving earnings a big lift. Revenue has also been strong, tracking to an 8.2% year-over-year increase. (LPL)

Oil prices are likely to stabilize. Oil prices have been pushing higher in the wake of the U.S. withdrawing from the Iran nuclear deal, but prices are likely to stabilize as oil markets absorb the news. Impacts of the U.S. sanctions is 200,000 to 1 million barrels a day, but U.S. producers should be able to make up much of the gap. Consumers bear the brunt of higher oil prices, especially those on the lower end of the income spectrum who spend a larger percentage of their income on fuel, but the impact of price changes thus far are small compared to the benefits of the new tax law. (LPL)

Alaska Airlines will close its New York base and reinforce its West Coast fleet. They are asking more than 100 pilots to relocate to California. Alaska currently operates five flights a day from JFK to both LAX and SFO. (CNBC)

NFIB’s Small Business Economic Trends Survey saw the 17th consecutive month of historically high readings in April. Never in the history of this survey have we seen profit trends so high. The optimism small businesses owners have about the economy is turning into new job creation, increased wages and benefits, and investment.

Congressional Quarterly reported the US Department of Agriculture proposed a rule which would mandate labeling of foods that “contain genetically modified crops or ingredients.”

Ford plans to resume production of the F-150 pickup truck on Friday. F-150 plants stopped production last week because of parts shortages caused by a fire at a factory of a key supplier. (CNBC)

Xerox has dumped its planned $6.1 billion deal with Japan's Fujifilm. Fujifilm said it was considering its options, including legal action to seek damages. (Reuters)

Walmart may take India-based e-commerce company Flipkart public in four years. Walmart announced last week it would pay $16 billion for a 77% stake in Flipkart. (CNBC)

Stocks were higher yesterday, and Apple hit a record high, as tepid inflation data eased worries of faster interest rate hikes this year.

The U.S. Labor Department's consumer price index increased 0.2 percent in April, less than economists' expectations, as rising costs for gasoline and rental accommodation were tempered by a moderation in healthcare prices.
Core CPI, which excludes food and energy components, edged up 0.1 percent in April, slower than the previous two months, and did little to alter traders' expectations of a June rate hike.

So far, 444 S&P 500 companies have posted earnings and those companies are showing profit growth of 24.5% from the same period a year ago and 9.3% growth in revenues. Almost 78% of those companies beat per-share earnings-per-share estimates, while 75% beat revenue estimates.

On the eve of Mother’s Day weekend, Americans are expected to spend $23 Billion on Mom this weekend or $180 apiece. It turns out that Mom doesn’t want the Brunch or the present. What she really wants is to be left alone according to a survey on the website Moneyish.

U.S. stocks traded higher yesterday, led by sharp rallies in energy, financials and industrials sectors. Energy stocks were boosted by President Donald Trump’s decision a day earlier to pull the U.S. out of the Iran nuclear deal and resume sanctions against the oil-producing nation.

Shares of Walmart fell 2.9% after the retail giant said it was taking control of India’s largest e-commerce company, Flipkart Group, for $16 billion, as the Bentonville, Ark.-based company tries to fend off Amazon at home and abroad.

Oil prices and the U.S. dollar are rallying in tandem—a dynamic that has only occurred 11 times since 1983, and it’s drawing the attention of market participants because it’s not supposed to happen. The coordinated run-up is rare because a stronger dollar makes commodities priced in the currency more expensive to users of other currencies. So a stronger dollar tends to be a headwind for commodity prices.

Shares solar companies jumped nearly 6% Wednesday on news that California regulators approved new building standards that will require new homes built in the state to have solar panels starting in 2020, the first state to do so.

U.S. stocks ended flat yesterday, in rocky trading, after President Donald Trump, as expected, said he is removing the U.S. from a 2015 nuclear deal with Iran.

Shares of Disney traded higher after the company stronger-than-expected profit and sales yesterday afternoon, with the biggest beat coming from the company's movie-studio arm after the huge success of "Black Panther." Disney reported fiscal second-quarter net income of $2.94 billion, or $1.95 a share, on sales of $14.55 billion, up from $13.34 billion a year ago. After adjustments for comparability to previous quarters, Disney claimed earnings of $1.84 a share, up from $1.50 a year ago.

The big pickup in job openings has done what’s not been accomplished in the nearly two-decades — there’s now a job opening for every unemployed worker.
According to the latest data from the Job Openings and Labor Turnover Survey, there were 6.55 million job openings in March. In March, there were 6.59 million unemployed, meaning there are 1.01 unemployed workers for every job. During the financial crisis there were 6.7 unemployed people for every job opening.

The 2 year Treasury note now yields 2.513% marking it’s highest yield in 10 years and flattens the yield curve even more as the long end of the curve remained unchanged.

Earnings season has been a success by virtually any measure, with an impressive upside surprise, very strong growth, and positive guidance overall. With 409 S&P 500 companies having reported, S&P 500 earnings for the first quarter are tracking to a nearly 26% year-over-year increase. The revenue picture is similarly positive producing an 8.4% annual increase. The earnings parade slows down this week with just 44 S&P 500 companies slated to report. (LPL)

The current economic expansion has reached 107 months, topping the 106-month expansion from the 1960s to make it the second longest since World War II. Only the 120-month expansion during the 1990s was longer. (LPL)

Oil tops $70/barrel. The potential for reinstatement of Iran sanctions pushed WTI crude over $70 for the first time since November 2014. Venezuelan production disruptions and Saudi Arabia's stated preference for an $80 price per barrel, on top of strong global demand and an easing inventory glut, have pushed U.S. oil to fresh multi-year highs despite recent strength in the U.S. dollar. (LPL)

The U.S. economy created 164,000 jobs in March. The overall employment level ticked higher as the labor force participation rate fell to 62.8%, pushing the unemployment rate to an 18-year low of 3.9%. Wages grew 0.1% month over month in April, slightly below expectations of 0.2% growth, to put year-over-year wage growth at 2.6%. (LPL)

The Institute for Supply Management's Non-Manufacturing Purchasing Managers' Index fell to 56.8 in April, a decline from March's 58.8. Nevertheless, some of the background data showed potential for continued strength. The new orders subindex, which tends to lead future activity, climbed to 60. Service sector expansion remains healthy following a very strong first quarter and the data remain consistent with steady growth. (LPL)

Nestle will pay Starbucks $7.15 billion for the rights to sell their products around the world. Nestle is taking on about 500 Starbucks employees as part of the deal. (Reuters)

Problems continue for Wells Fargo as they settled a class action securities fraud lawsuit with shareholders for $480 million, in a case stemming from "misstatements and omissions" regarding its sales practices. (CNBC)

Proving it isn’t over till the fat lady sings, the Dow Jones industrial average erased a nearly 400-point loss yesterday snapping a four-day losing streak. The S&P 500 closed down 0.23% after dropping as much as 1.6%. The Nasdaq fell 0.18% after dropping more than 1%. (CNBC)

The Department of Labor says the US economy added 164,000 jobs in March. The private sector added 168,000 of those jobs. The unemployment rate fell to 3.9%.

The Commerce Department says the trade deficit slid to $49 billion, down from $57.7 billion in February and lowest since September. Exports rose in March to a record $208.5 billion, led by shipments of civilian aircraft and soybeans. Imports slipped 1.8% to $257.5 billion. The trade gap is up 18.5% to $163.4 billion so far this year.

Worker productivity increased in the first quarter at a 0.7% annualized rate. Unit labor costs, the price of labor per single unit of output, rose at a 2.7% pace in the first quarter. (AP)

Join us this weekend for Financial Focus Radio when Tyler and I will both be back in the “Truth in Wealth Building” saddle.

Wednesday’s sell-off left the Dow Jones in correction territory with losses in 9 of the past 11 sessions. The Nasdaq has declined 7 of the past 10 days, with the S&P 500 down in two of the past three days. (CNBC)

Fired Nike executive David Reichert has pleaded guilty to two counts of wire fraud. He defrauded Nike of more than $550,000. Prosecutors will ask that he serve 1 ½ years in prison and pay $400,000 in restitution. (OregonLive)

Eurozone April Manufacturing PMI came in at 56.2, the lowest it has been since March 2017. A strong euro, flu season, and weather were all named as potential reasons for the weaker data. Turning to China, their Manufacturing PMI was 51.1 last month, better than expected. (LPL)

Texas oil production jumped to 4.01 million barrels a day in February, up almost 21% from a year earlier, according to the Energy Information Administration, the highest since 1981. That helped push total U.S. crude output in February up 2.6% to a new record of 10.3 million bpd.

The ISM says its index of national factory activity dropped to a reading of 57.3 last month from 59.3 in March. A reading above 50 indicates growth in manufacturing, which accounts for about 12% of the U.S. economy. (CNBC)

You know I love my treats, so good news for us Oreo fans. The parent company Mondelez will begin rolling out three limited-edition flavors, cherry cola, kettle corn and pina colada. (USA Today)

Google has invested $10.5 billion building data centers across the country since 2006. Google opened its third data center in The Dalles, Oregon in February and now employs 200 there. The Dalles received about $937,000 in electricity franchise fees in 2017. (OregonLive)

The Fed begins a two-day policy meeting this morning, with an interest rate decision and policy statement set for tomorrow at 11 PST. No rate hike is expected this time, and there's no post-meeting news conference. (CNBC)

The Commerce Department reported consumer prices jumped 2.0% year-on-year in March. That was the biggest gain since February 2017.

The Commerce Department's also reported consumer spending increased 0.4% in March. Consumer spending grew at a 1.1% annualized rate. The slowest in nearly five years.

Wages gained 0.2% in March. Savings fell in March, as the saving rate slipped to 3.1%.

With 267 S&P 500 Index companies having reported earnings for the quarter are tracking to a 24.6% year-over-year increase.